Owners eyeing development at St. Malo

Ray Tyson

Petroleum News Houston correspondent

Owners of the St. Malo oil discovery in the Gulf of Mexico are moving ever closer to sanctioning a development plan for the promising deepwater prospect at Walker Ridge Block 678.

“Assuming positive results from the appraisal, we will begin firming up a development plan,” Devon Energy President John Richels said May 6.

Devon holds a 22.5 percent interest in the Unocal-operated St. Malo prospect, which already has turned up more than 450 feet of net oil pay over a gross hydrocarbon column of 1,400 feet, indicating a major accumulation by Gulf standards.

Devon’s Richels said a rig was on location to begin drilling a first appraisal well on the east bank of the St. Malo structure. Actually, drilling involves re-entering and deepening an existing well, he added. The owners have indicated that any development plan at St. Malo could include discoveries at nearby Cascade and Sturgis. In fact, a Devon representative said at this month’s Offshore Technology Conference in Houston, Texas, that one option being considered for the area is a so-called FPSO, or floating production, storage and offloading facility.

FPSOs, useful where pipelines and other infrastructure are sparse or non-existent, are typically used for isolated fields around the globe but have yet to make their debut in the Gulf. Oil is generally transported ashore via marine tankers.